There is no change in the indicator summary. The AD Lines and AD Volume Line both surged to new 52-week highs this week. Major bearish reversals in the stock market are often preceded by bearish divergence in one or more of these indicators. With fresh 52-week highs, bearish divergences are... READ MORE
As you might expect, there is no change in the medium-term trend (daily chart) or short-term trend (60-minute chart). SPY is now up over 5% this month with gains on 11 of the last 14 days. In January, the index zigzagged higher with a choppy advance from ±125.5 to... READ MORE
Dow Theory is built on the concept of confirmation. The Dow Transports should confirm a higher high in the Dow Industrials and visa versa. Failure to confirm signals that something might amiss. The Dow Industrials has been forging new highs throughout the month and the Dow Transports just made it... READ MORE
EMERGING MARKETS ARE 2011 LAGGARDS... I'm not a believer in global decoupling. On the contrary, I believe that global stock markets are highly correlated and usually trend in the same direction. That's especially true of the relationship between emerging and developed markets. Chart 1 shows a... READ MORE
On the daily chart SPY surged on 1-Feb with a gap and long white candlestick that closed above 130. The advance continued after this surge with a grind higher. We can see bigger surge-grind patterns starting with the early September surge and the early December surge (green dotted lines). There... READ MORE
CHRW consolidates at support. NEM breaks short-term resistance. KSS breaks wedge resistance with volume. Plus AEO, INTC, LUB, QLGC and T ----------------------------------------------------------------------------- This commentary and charts-of-interest are designed to stimulate thinking. This analysis is not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise)... READ MORE
The Lumber Continuous Futures ($LUMBER) remains in a clear uptrend with a series of higher highs and higher lows since late June. This advance (roughly) corresponds with an advance in the Home Construction iShares (ITB). ITB was a little shakey in October-November, but the etf has been moving higher since... READ MORE
HOUSING RELATED ETFS LEAD STOCKS HIGHER... Link for todays video. A rebound in January housing starts put a bid into housing related ETFs on Wednesday. Chart 1 shows the Homebuilders SPDR (XHB) within a clear uptrend since late August. The ETF broke above resistance in early January and then consolidated... READ MORE
There is no change in the analysis for the 60-minute chart and daily chart. SPY gapped up the last two Monday's and both gaps held. The advance appears to be accelerating in February. Notice the sharp advances followed by short pullbacks this month. Yesterday's pullback stopped... READ MORE
GOLD MINERS BULLISH PERCENT INDEX TURNS UP ... I've devoted the last two Tuesday messages to signs of an upturn in precious metal assets which have been largely ignored in the recent commodity rally. Although stocks tied to coal, copper, oil, and steel have been soaring, precious metal stocks... READ MORE
Intel is meeting some pretty stiff resistance around 22, but the overall trend remains up. The stock formed a big bearish engulfing in early December and a harami on Thursday-Friday. Even though harami are potentially bearish candlestick patterns, confirmation is required with some downside. Namely, look for a break below... READ MORE
There are dueling wedges for the Euro Currency Trust (FXE) and the Gold SPDR (GLD). FXE remains in a downtrend with a falling wedge, while GLD remains in an uptrend with a rising wedge. FXE broke support the first week of February, formed a lower high last week and moved... READ MORE
ANF stalls near key retracement. BRCM shows relative weakness. INTC forms harami near resistance. Plus BBBY, BSX, CME, GILD and SWY ----------------------------------------------------------------------------- This commentary and charts-of-interest are designed to stimulate thinking. This analysis is not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise)... READ MORE
ENERGY STOCKS SURGE AS WTI CRUDE FLATTENS... Link for todays video. Energy stocks were strong on Monday as the Energy SPDR (XLE) recorded another 52-week high and the Oil Service HOLDRS (OIH) surged over 2%. This is all the more impressive considering that West Texas Intermediate ($WTIC) has been flat... READ MORE
The PerfChart below shows five tech-relate ETFs along with the S&P 500 and the Nasdaq 100 ETF (QQQQ). All are up sharply since late August, but three are up more than 40%. The Networking iShares (IGN) is up some 48.4%, the Semiconductor HOLDRS (SMH) is up 45.... READ MORE
Despite low volume the last few months, the stock market continues to move higher. Let this be a lesson. Volume is an indicator that comes second to price action. In addition, overall volume is not as important as the balance of volume. Total volume may be low, but stocks can... READ MORE
DISSECTING THE REVERSALS IN 2000 AND 2007... Stocks remain in bull mode with fresh 52-week highs in the major indices. There is little doubt that the big trend is up. Many pundits, myself included, consider the stock market overbought and ripe for a correction or a pullback. However, buying pressure... READ MORE
Something has clearly spooked the bond market over the last five months. Looking at the CRB Index, that something appears to be inflationary pressures. The CRB Index bottomed in early July and advanced over 30% the last seven months. Bonds peaked two months after the CRB Index bottomed and declined... READ MORE
Three indicators were upgraded this week. With the three of the four key offensive sectors recording 52-week highs this week, I can hardly be bearish on this indicator. XLY, XLI and XLK hit new highs, while XLF remains close to its April high. Even though the Nasdaq has been underperforming... READ MORE
The Euro Currency Trust (FXE) broke down with a sharp decline, but the Gold SPDR (GLD) bounced after early weakness to hold well above support. I suspect that the Dollar is strengthening for a number of reasons. First, US interest rates surged in February. Second, turmoil in Egypt and the... READ MORE
Macy's (M) was one of ten NYSE stocks showing up on the Shooting Star scan on the Predefined Scans page. After surging the prior three days, the stock hit resistance from broken support and formed a large shooting star on Wednesday. Note the small body, the long upper... READ MORE
The Gold SPDR (GLD) remains in an uptrend, but this bullion ETF warrants a close watch as it trades near the 50% retracement with a rising wedge. I identified the inverse head-and-shoulders and breakout last week and GLD remains in an uptrend as long as the wedge rises. Typically, a... READ MORE
ABX forms rising flag. SWY breaks P&F trendline. X forges bearish engulfing at resistance. Plus FCX,HRB,MHP. This commentary and charts-of-interest are designed to stimulate thinking. This analysis is not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise). We all... READ MORE
After taking a big hit at the end of January, the Consumer Discretionary SPDR (XLY) firmed and surged to a new 52-week high this month. The ETF is up seven of the last eight days with a 5.3% advance. This is the sharpest advance since early September. This is... READ MORE
EXCHANGE VOLUME AINT WHAT IT USED TO BE... Link for todays video. Exchange and index volume levels are increasingly difficult to measure. In the good olds days, stocks traded on the exchanges and the exchanges reported volume. Reported volume levels were pretty close to reality and volume based indicators were... READ MORE
A virtual free fall in bonds is fueling a rally in stocks, and possibly gold. The first chart shows the 10-year Treasury Yield ($TNX) surging from 33.25 to 37.25 (3.325% to 3.725%) over the last seven days. The corresponding bond ETF (IEF) has fallen from around... READ MORE
The USO Oil Fund (USO) and the US Gasoline Fund (UGA) normally track each other pretty well, but these two have gone their separate ways over the last four weeks. UGA (red) is up around 1% and USO (black) is down around 4% since January 11th. This is unlikely to... READ MORE
PRECIOUS METALS CONTINUE TO CLIMB ... My last two market messages from last week wrote about signs of an upturn in precious metal assets. Signs of an upturn are growing even stronger. Chart 1 show Gold Trust Shares (GLD) trading back over their 20-day average (green line) for the first time... READ MORE
The S&P 500 ETF (SPY) is up 3.3% in the last six trading days or month-to-date. This is the sharpest 6-day advance since early December. There is, however, a big difference between the early December surge and the current surge. Looking back, I identified four times when... READ MORE
AKAM shows relative weakness. APD breaks flag resistance with gap. S consolidates with triangle. Plus CAKE, FDX, GTIV, MHP, URBN, USG This commentary and charts-of-interest are designed to stimulate thinking. This analysis is not a recommendation to buy, sell, hold or sell short any security (stock ETF or otherwise). We... READ MORE
The S&P Sector Market Carpet provide a nice color-coded means to view performance over a given period of time. This chart shows performance since December 31st. All sectors are up, but there are rather significant pockets of weakness (red) within these sectors. Click this image for a live... READ MORE
QQQQ HITS NEW HIGH WITH BREAKOUT... Stocks extended their gains on Monday with the major index ETFs hitting new 52-week highs. This includes the S&P 500 ETF, the Dow Industrials SPDR, the S&P MidCap 400 SPDR, the Russell 2000 ETF and the Nasdaq 100 ETF. Despite... READ MORE
The Dollar/Gold relationship is a tough one to figure out these days. 2011 has seen both decline in January and bounce in February. The correlation this year appears to be largely positive, which is counter to the historically negative correlation. At times like these, it is often best to... READ MORE
Hello Fellow ChartWatchers! As I travel around the country talking to various investment groups, I always make a point to remind everyone about the what I call "The Technical Process" - the steps that every investor goes through before taking a position in a stock. Some people get... READ MORE
My Tuesday message showed the Market Vectors Gold Miners ETF (GDX) testing long-term support at its 200-day moving average, and suggested watching it closely for signs of an upturn. Today's strong rally in precious metals assets may be the start of that upturn. Chart 1 shows the GDX... READ MORE
While the US markets power towards higher highs - although in a weak manner we might add, we've begun to see outflows of funds from the Emerging Markets. Ostensibly, this is due in large part to the Egypt uprising, but there are other issues the emerging markets are... READ MORE
Attempting to short this market prior to any significant breakdown is the equivalent of financial suicide. Taking profits occasionally, moving into cash, and awaiting entry on a new position is fine. But shorting this uptrend with hopes of a big reversal just makes no sense. Since January 27th, take a... READ MORE
(This is an excerpt from Monday's blog for Decision Point subscribers.) One of the things I constantly flog in this blog is that equal-weight indexes usually perform better than cap-weighted indexes. The reason they perform better is that smaller-cap stocks normally perform better than large-cap stocks, and the... READ MORE
The S&P 500 %Above 50-day SMA ($SPXA50R) indicator is a breath gauge that measures the degree of participation. In this instance, the indicator tells us the percentage of S&P 500 stocks that are above their 50-day SMAs. In general, a bullish bias exists when more than... READ MORE
Bollinger Bands narrow as volatility falls and widen as volatility rises. The theory is that a volatility contraction is often followed by a volatility expansion. The directional clue depends on the break. Garmin (GRMN) has a classic contraction breakout working with a surge above the upper band on Friday. Notice... READ MORE